Chapter
Six:
Macroeconomic
Measurement:
Environmental
and Social
Dimensions
Why GDP is Not a Measure of WellBeing
Figure 6.1: Average Subjective Well-Being and
GDP per Capita
Average SWB (1-10 scale)
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
5.0
4.5
4.0
0
20,000
40,000
60,000
80,000
GDP per capita, 2008 PPP
Sources: SWB from World Values Survey online data analysis, 2005–2008 survey wave; GDP from World Development
Indicators online database
Alternative Approaches to
Representing Well-Being
Table 6.1: Genuine Progress Indicator,
United States, 2004
Component of GPI
Personal consumption
Personal consumption after inequality adjustment
Value of household work and parenting
Value of higher education
Value of volunteer work
Service value of consumer durables
Service value of highways and streets
Costs of crime
Loss of leisure time
Costs of underemployment
Cost of consumer durables
Costs of commuting and auto accidents
Costs of environmental defensive expenditures
Costs of pollution
Value of lost wetlands, farmland, and forests
Costs of nonrenewable energy depletion
Damages from carbon emissions and ozone depletion
Adjustment for capital investment and foreign
borrowing
Genuine Progress Indicator
Value (billions of dollars)
7,589
6,318
+ 2,542
+ 828
+ 131
+ 744
+ 112
—
34
—
402
—
177
— 1,090
—
698
—
21
—
178
—
368
— 1,761
— 1,662
+
135
4,419
Talberth et al., The Genuine Progress Indicator 2006: A Tool for Sustainable Development. Redefining Progress, 2007, pp. 1–2. http://rprogress.org.
GDP and GPI Per Capita (2000 US $)
Figure 6.2: Comparison of GDP and GPI per
Capita, United States, 1970-2004
Gross Domestic Product
Genuine Progress Indicator
Talberth et al., The Genuine Progress Indicator 2006: A Tool for Sustainable Development. Redefining Progress, 2007, pp. 1–2. http://rprogress.org.
Figure 6.3: New Zealand’s Auckland Regional
GPI vs. DP, 1990-2006
60
Billions NZ $
55
50
45
40
35
30
25
20
1990
1992
1994
1996
GPI
Source: McDonald, et al., 2009
1998
GDP
2000
2002
2004
2006
Figure 6.4: Components of the GPI for Maryland,
1960-2010
200
Billions of 2000 Dollars
150
100
50
0
1960
1970
1980
1990
2000
2010
-50
-100
Economic Indicators
Source: http://www.green.maryland.gov/mdgpi/mdgpioverview.asp
Social Indicators
Environmental Indicators
Figure 6.5: Selected Countries as Ranked in the
Human Development Index
Human Development Index (Scale: 1 - 100)
95 - 100 — Australia, Norway, Ireland
Canada, Netherlands, Germany, Japan,
Sweden, United States, Denmark,
90 - 94.9 —
Switzerland, Spain, France, Belgium, Italy,
Finland, Austria, Greece
85 - 89.9 — United Kingdom, Poland, Singapore
80 - 84.9 — Argentina, Portugal, Mexico
75 - 79.9 — Russia, Colombia
70 - 74.9 — Brazil, China, Philippines, Thailand, Turkey
65 - 69.9 — Indonesia
60 - 64.9 — South Africa
55 - 59.9 — Kenya, India, Bangladesh
50 - 54.9 — Pakistan
45 - 49.9 — Nigeria
Source: UNDP, Human Development Report, 2011 data
Accounting for the Environment
Figure 6.6 Indonesian GDP Adjusted for
Resource Depreciation
15
Billion Rupiah (thousands)
14
13
12
11
10
9
8
7
6
5
1971
1973
1975
1977
GDP
1979
1981
1983
EDP
Source: Repetto, Robert, et al. (1989), Wasting Assets: Natural Resources in the National Income Accounts. Washington, D.C.: World Resources Institute.